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NAFTA 2.0: For people or Polluters?

A Climate Denier’s Trade Deal versus a Clean Energy Economy

Communities across North America are enduring falling wages and rising climate threats. Instead of reducing these problems, the North American Free Trade Agreement (NAFTA) is exacerbating them. NAFTA was written before broad awareness of climate change, and negotiated with input from fossil fuel executives, not workers, climate scientists, or climate-impacted communities. Predictably, the negotiation prioritized the profits of multinational firms, not the well-being of working families who face increasing climate hazards. As a result, NAFTA includes an array of little-known rules that bind North America to fossil fuel dependency rather than supporting a just transition to a clean energy economy. It is an obstacle to climate progress.

After more than two decades of NAFTA, the deal is finally being renegotiated, offering an opportunity to invert its backwards priorities. Civil society organizations, academics, and legislators across North America have offered a litany of specific ideas for a more equitable, climate-compatible deal. This time around, will negotiators prioritize the workers and communities that have been hardest hit by the fossil fuel economy, or the CEOs who profit from it?

The track record so far is not encouraging. While some important proposals for change reportedly sit on the negotiating table, many of NAFTA’s handouts to corporate polluters remain untouched. Even worse, negotiators are entertaining new corporate-backed rules for NAFTA 2.0 that would pose additional barriers to the bold climate action that science and justice demand. Such terms, if accepted, would be an exercise in climate denial, with long-lasting consequences for workers and communities across North America. We cannot shift to a clean energy future if a corporate trade deal tethers us to the fossil fuel past.

In this report, leading economists from each of the three NAFTA countries present original research and analyses on the climate implications of NAFTA, the new climate threats that NAFTA 2.0 could pose, and concrete alternatives for replacing NAFTA with a climate-friendly trade agreement. Here are some of the key findings: